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2018 (4) TMI 860 - AT - Income TaxRevision u/s 263 - directed the AO not to allow deduction u/s. 80IB(10) while computing book profit u/s.115JB - Held that:- Supreme Court in the case of CIT vs. D.P.Sandhu Brothers [2005 (1) TMI 13 - SUPREME Court] held that the receipts which are not taxable cannot brought to tax under any other section. Deduction claimed by assessee in the instant case u/s.80IB (10) is not taxable under the normal provisions of the Act cannot be treated as part of book profit u/s.115JB, hence, the ld. AO has adopted one of the possible view. Thus, Income arising from development of housing projects are not taxable Sec 80IB(10) and were excluded from its purview. Sec. 80IB(10) income will not be part of MAT income and MAT tax. Thus, the assessment order was rightly passed and cannot be termed as erroneous & prejudicial to interest of revenue. Provision of section 263 will apply when decision of AO is erroneous as well as prejudicial to the interests of the Revenue. But in a case where two views are possible and the AO has taken one view, with which the CIT does not agree, it cannot be treated as an erroneous order, prejudicial to the interests of the Revenue. In that situation provision of section 263 cannot be invoke. Explanation 2(d) under section 263 specifically states that revision is possible only due to judgments of the jurisdictional High Court or supreme court. Further, the assessee has placed the reliance on the various decision where the ratio was laid down were in favour of the assessee. The considerable favourable view was available. Therefore, as there were two views were available, the Ld. CIT should not be allowed to invoke the powers u/s.263. If the answer of the above refereed question held as yes, then the Ld. CIT will invoke power in each and every cases and will create a huge mess. The power of CIT is restricted to the decision of the jurisdiction high court or Supreme Court which were overlooked by the assessing authority. No merit in the action of CIT u/s.263. - Decided in favour of assessee.
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